A former Ontario mutual fund salesman has been accused of selling investments for DSC Lifestyle Services, a financial advisory firm that has ravaged investors in B.C. and elsewhere in Canada, without his employer’s knowledge or consent.

The Mutual Fund Dealers Association of Canada has also accused the salesman, Edmund Teelucksingh of Brampton, with accepting unauthorized and undisclosed referral fees from DSC. A hearing is pending.

The MFDA enforcement action provides more evidence of the havoc that DSC and its two principals, Ingram “Jeff” Eshun and Roger Blair, have wreaked on investors across Canada.

In January, the B.C. Securities Commission permanently banned Eshun and his B.C. regional director, Maisie Smith of Coquitlam, from the B.C. securities market after finding they illegally sold $5.7 million in promissory notes in their private company, J.V. Raleigh Superior Holdings Inc., to 81 B.C. investors.

The BCSC hearing panel said there was no evidence that Eshun and Smith used any of investors’ money for the stated purpose, yet the RCMP Commercial Crime Section in B.C. is refusing to investigate. RCMP spokesmen say the section has more pressing priorities.

That, in my view, is a serious miscalculation. The J.V. Raleigh promissory notes were just one of many bad investments that Eshun and Blair sold to investors in B.C. and elsewhere, with devastating results.

I have chronicled a half dozen of those investments in previous columns. They include:

• A Whitby, Ont., land deal (GDC Investments Inc.) that has collapsed.

• Loans to a Turks & Caicos-registered company (Xeris Capital Initiative Ltd.) that were never repaid.

• A scheme that would purportedly enable investors to “unlock” money from their RRSPs (PFC 2016 Pacific Financial Corp.), but was disallowed by the CRA.

CRA has also alleged in search warrant information that Eshun and Blair referred at least 84 clients to a Markham-based tax preparation firm called Fiscal Arbitrators, which instructed those clients to claim millions of dollars of dubious business expenses.

This has also been a disaster. CRA has criminally charged the two principals of Fiscal Arbitrators, reassessed their clients and slapped them with gross negligence penalties.

Fiscal Arbitrators and DSC personnel are now referring those beleaguered taxpayers to DeMara Consulting Inc., a Vernon tax preparation firm that purports to have a rescue plan for them.

That’s bad news, too. DeMara is run by Donna Marie Stancer, who was criminally convicted of tax offences in 1989 and has declared personal bankruptcy on two occasions.

In March 2012, CRA raided DeMara’s offices in Vernon, alleging that the firm had claimed more than $150 million in bogus business losses on behalf of 179 clients. That investigation is still in progress.

Now MFDA enforcement staff have issued a notice of hearing revealing more DSC-related dirty business.

The notice alleges that, from 2005 to 2009, Teelucksingh — while working at GP Wealth Management Corp. in Markham — “referred clients and individuals to DSC, a company that sold investment-related products, services and programs” without his employer’s knowledge or consent.

One of those investments was alleged to be debentures issued by DSC for a term of one year and earning eight to 12 per cent per year.

According to the notice, Teelucksingh was “unwilling or unable” to say how much DSC paid him for referring this investment, other than to admit he received at least $63,000 in referral fees in 2006.

The notice further alleges that Teelucksingh sold or referred investments in another deal that was offered through DSC — shares in Land Banc of Canada Inc. — to 19 clients and 27 non-clients without his employer’s knowledge or consent.

Once again, the notices says he was “unwilling or unable” to provide MFDA enforcement staff with details of his referral fees.

Land Banc has also been a troubled investment. In May 2007, the Ontario Securities Commission issued a notice of hearing alleging that Land Banc and its officers and directors sold shares without meeting prospectus and registration requirements. The case has still not been formally resolved.

One of those Land Banc directors was Marco Lorenti, who — not coincidentally — was also a key player in GDC Investments Inc., another land deal that was heavily promoted by DSC, Eshun and Blair in Ontario, B.C. and elsewhere.

This deal, like virtually all the deals promoted by DSC, had little or no chance of commercial success. In September 2010, I wrote a column noting that it was so loaded with fees that it would likely “end up on the rocks without enough lifeboats to go around.” Sure enough, GDC’s project has collapsed and shareholders have little or no hope of recovering any of their money.

The MFDA notice also alleges that Teelucksingh sold or referred investments in Dixon Perot & Champion Inc. — which operated through DSC as a charitable donation program — to 30 clients and 17 non-clients without his employer’s knowledge or consent.

Once again, the notice says he was “unwilling or able” to provide MFDA enforcement staff with details of his compensation, other than it ranged from three to 10 per cent of the investment amount.

Not mentioned is the fact that in July 2012, the OSC laid what it described as a “quasi-criminal” fraud charge against Abraham Herbert Grossman (aka Allen Grossman) and his firm, Strategic Gifting Group, in connection with the donation scheme.

The OSC alleges that from Oct. 2009 to February 2011, Grossman and his firm sold shares of Dixon Perot & Champion (which was listed on the Frankfurt Stock Exchange) to investors at a certain price, then arranged for them to donate those shares to charities at a much higher price. This enabled the donor to obtain a tax credit exceeding his out-of-pocket cost.

The OSC alleges that Strategic charged the charities a service fee equal to 90 per cent of the amount invested, for a total of $332,620.

The OSC further alleges that Grossman engaged in the fraudulent scheme while he was prohibited from trading in securities by the OSC and in the middle of two unrelated trading and fraud trials. He was subsequently sentenced to 21 months in jail for operating a stock “boiler room.”

A clear pattern is emerging here. Eshun and his buddies mainly sell other people’s grimy deals. Regulators, when they do intervene, tend to go after the principals, rather than the agents. That enables them to skip from one bad deal to another with virtual impunity.

That makes it all the more important that the RCMP investigate Eshun’s and Smith’s sale of the J.V. Raleigh notes, which the BCSC hearing panel said were sold to investors under “false pretences.” Since that was their deal, they can be justly held responsible for its creation, promotion, marketing and stewardship.

But as mentioned, the Mounties say they have “more pressing priorities,” so Eshun continues his dubious and injurious investment activities. At last report, he was promoting a high-yield investment deal involving gold from Ghana. What a pathetic state of affairs.

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